Employee Retention: Tips and Tools For Employee Retention: Top Ten Employee Complaints
Employee Retention: Tips and Tools For Employee Retention: Top Ten Employee Complaints
the maximum period of time. Corporate is facing a lot of problems in employee retention these days.
Hiring knowledgeable people for the job is essential for an employer. But retention is even more
important than hiring. There is no dearth of opportunities for a talented person. There are many
organizations which are looking for such employees. If a person is not satisfied by the job he’s doing, he
may switch over to some other more suitable job. In today’s environment it becomes very important for
organizations to retain their employees.
Job Stickiness
Core values that are understood and rewarded and feeling a part of a sense of purpose at work are
reasons organizations retain staff. Read more ideas for entrepreneurs at More.Business.com.
Now that so much is being done by organizations to retain its employees, why is retention so
important? Is it just to reduce the turnover costs? Well, the answer is a definite no. It’s not only
the cost incurred by a company that emphasizes the need of retaining employees but also the
need to retain talented employees from getting poached.
The process of employee retention will benefit an organization in the following ways:
1. The Cost of Turnover: The cost of employee turnover adds hundreds of thousands of
money to a company's expenses. While it is difficult to fully calculate the cost of turnover
(including hiring costs, training costs and productivity loss), industry experts often quote 25% of
the average employee salary as a conservative estimate.
2. Loss of Company Knowledge: When an employee leaves, he takes with him valuable
knowledge about the company, customers, current projects and past history (sometimes
to competitors). Often much time and money has been spent on the employee in
expectation of a future return. When the employee leaves, the investment is not
realized.
4. Turnover leads to more turnovers: When an employee terminates, the effect is felt
throughout the organization. Co-workers are often required to pick up the slack. The
unspoken negativity often intensifies for the remaining staff.
5. Goodwill of the company: The goodwill of a company is maintained when the attrition
rates are low. Higher retention rates motivate potential employees to join the
organization.
So what's one of the biggest reasons people quit their jobs? "One of the major reasons is
being dissatisfied with their supervisor," says Linda Argote, a professor of organizational
behavior at Carnegie Mellon and editor-in-chief of Organization Science. And in the
cramped confines of a small business, that relationship can create even more of a strain.
"In bigger companies there are more opportunities to move to other jobs if you're
dissatisfied with a particular supervisor but like the firm, whereas smaller companies
may have less options so they run the risk of losing the employee," Argote adds.
Bonuses, vacation days, office parties, and many of the tools in a business owner's
arsenal revolve around rewarding employees for a job well done and motivating them to
produce similarly stunning results in the future. But Murphy says that leaders who dole
out these types of perks are only focusing on half of the picture.
There are "two issues generally going on with employees at any given time: there are
'shoves,' things that demotivate people, and then there are 'tugs,' the things that motivate
you, that tug at you to stay at the organization," he says. While these factors will differ for
every employee, leaders often make the mistake of focusing on the motivators without
adequately considering what rubs people the wrong way.
In the last 10 years, as CEO of Engage Direct Mail, Dennis Hoffman learned the hard way
that "I never know what's inside people's heads. I used to assume everybody's ambitious
because I'm ambitious and that everybody's motivated by money because I'm motivated
by money, and I've learned through painful experience that that's not the case."
Despite Hoffman's self-professed learning curve, his company actually has a stellar
retention rate for its 130 employees. Engage has a 90-day trial period during which they
evaluate whether new hires are good fits for the company. During that time their
retention rate is about 77 percent and afterwards it is over 95 percent, which is about as
good as you can get. After all, "zero percent turnover is not a thing to aim for," Murphy
explains. You want to retain your high performers and strong matches and gracefully
part ways with your worst performers.
Over the years, Engage has implemented a number of policies that serve the dual
purpose of attracting potential employees and keeping current ones passionate and
committed. Here are a handful of examples:
Engage gives hiring priority to people who live near the office because they
believe that long commutes are detrimental to work-life balance.
Instead of a traditional vacation policy, the company lets employees take time off
from a leave bank, in which they can accumulate as many as 60 days off to use as
they see fit. This policy has helped with employee retention, particularly by
making it easier for female employees starting families to take time off and
ultimately return to work.
During the hiring process, Engage administers the DISC Personality test, which
charts the four characteristics, drive, influence, steadiness, and compliance, to
build personality profiles for new hires. All employees' test results are public
knowledge, which Hoffman feels helps people understand one another and get
along.
By setting quarterly goals with rewards attached, such as iPods for the whole
team or a trip to a nice restaurant, Engage can encourage employees beyond the
competitive, and potentially divisive realm of salary bonuses. The group nature of
these rewards is important, says Hoffman, because "somebody who is not
motivated by getting an iPod knows that other people in his or her group are and
doesn't want to let them down."
In addition to spurring employees to productivity, this team structure can make them
happier in the workplace. Argote says, "there's evidence that being in cohesive work
groups where members like each other reduces turnover."
Many organizations are now realizing the bottom-line effect on retaining quality employees. Retaining
quality performers quite simply adds to increased productivity and morale, while reducing the associated
costs of turnover. As a business executive, doesn’t it make sense to have business processes that add
efficiencies to how you conduct business to reach your corporate objectives and provide a positive
Projections from the Bureau of Labor Statistics forecast a shortage of 10,033,000 workers by
2010.
Turnover analysis reports continue to show that the cost of unwanted turnover can be 1.5 times
When I consult with companies, the subject of identifying and retaining top talent is always one of the
critical items executives tell me they’d like to improve upon. However, when I ask what their strategy is
in that regard they either mention that they’ve found this great recruiting firm that is going to do
nothing but send them top-level talent, or they look at me and tell me the people that have left were no
There are a couple of flaws with this line of reasoning. First, just because a recruiter has sent you top-
level talent doesn’t mean that employee is going to stay and prosper with your organization. I can’t tell
you how many talented employees I’ve seen leave organizations because they were either miscast for
the job, management style, or corporate culture. Secondly, never assume a turnover problem exists just
because the employee was no good to begin with. Job fit and performance go well beyond just having a
talented employee. As with any business goal, you have to implement a proven process and strategy to
attain that goal. The following will outline a seven step strategy to increase employee retention, one that
helped one Fortune 500 Company realize a 67 percent increase in retention in the first year of
1. Conduct job analysis audits to provide realistic job previews. Conduct job analysis audits with
behavioral assessments, cognitive reasoning assessments, job simulations, and hard skills
assessments (e.g., computer skills, etc.) to objectively define the core competencies required
for success in each role (competency modeling). This helps in providing a realistic job preview
for candidates and managers. Oftentimes what managers think they need for a certain role is
and structured behavioral interviewing techniques to increase the likelihood of hiring people that
can, and will, do the job at a high level in your environment and for your managers (job fit
assessment).
3. Provide good employee orientation. The people you hire today are potentially your greatest
resource for corporate success in the years ahead. As a senior leader, your participation in new
employee orientation sends a vital cultural and leadership message: "We’re all involved here in
the drive toward what we want to be in the future." Everyone—even the newest employee—has
value.
4. Implement programs for employee training and development. Provide ongoing professional
people.
5. Improve manager and employee relationships. Concentrate on the people that stay with you to
learn what makes them happy … then give them more of it! "People leave managers, not
companies. If you have a turnover problem, look first at your managers," Marcus Buckingham
7. Encourage succession planning. Identify roles for which employees may be suited in the future
and work with them on designing their succession plan within the organization. Invest in cross-
In summary, many organizations are already using several of the aforementioned steps, but may be
lacking or deficient in the other steps. Each step is critical to the overall success of a comprehensive
At The Rainmaker Group we are committed to helping you Maximize Possibility by creating an employee
retention program and provide you with the proper retention training system that will identify and retain the top
performers within your organization.
We understand that time is money to your organization. Every minute of every day that your employee retention
problems persist your organization is losing valuable time, energy, and resources.
With the use of the powerful tools at our disposal, our employee retention experts will get to know your team
and organizational culture better than you could have ever imagined. By doing so we can get down to the real
causes of employee turnover in your organization and develop retention program that is right for your team.
Stop unwanted employee turnover dead in its tracks and get back to doing what you do best: growing and
leading your organization!
The cost of employee turnover can range between 1/2 to 4 times an employee's annual wages and
benefits
80% of turnover can be attributed to mistakes during the hiring process(Harvard Business Review)
Employee retention has as much to do with who you hire as what you do after he or she is hired
Traditional methods of hiring employees only provide a 14% likelihood of a successful job hire
(Michigan State University)
An ineffective employee retention strategy can drive any manager crazy. The crippling effects employee
turnover costs can have on your organization's efforts to consistently turn a profit only adds to the stress you
are already under as a leader in your organization. Don't despair. You can do something about the high cost of
employee turnover, dwindling levels of retention , and the steady outflow of quality workers!
We identify top performing team members and develop strategies to ensure they stay with your
organization
We can identify the reasons why an employee will leave before they are ever hired
We will help you select and hire great employees who are well fit for the job and your organizational
culture
We can help to improve communication and morale - two key elements that affect employee retention
We will assist in determining growth opportunities for team members and develop customized training
that will improve performance
There are few if any issues that business leaders face today that are more important than the effort to hire and
retain good employees. An effective employee retention program can have a dramatic impact on your
organization's bottom line. As employees grow so does your business, and its bottom line. It might seem like
common sense, but it can't be understated: an organization is only as good as the people it employs.
What if...
The Employee Selection Process - who you choose to fill job vacancies
The Human Development Process - what you do after the employee is hired
Here at The Rainmaker Group our employee retention experts have some of the most powerful tools available
to help you select the best employees and effectively coach and motivate your employees after they are hired.
Give us a call today. We are here to help and would love to hear from you!